Four months after Chinese billionaire Jia Yueting acknowledged his company LeEco was fast running out of cash, the erstwhile high-flying company has fired 85% of its India staff and allowed two leadership exits in what the industry says is a precursor to its eventual withdrawal from the South Asian nation.

Two top executives — Atul Jain, chief operating officer of smart electronics business, and Debashish Ghosh, chief operating officer for Internet applications, services and content — have resigned, according to three top industry sources. The company, which outflanked Xiaomi, Oppo and Vivo with an advertising budget as high as Rs 80 crore a month, had exited sales through offline retail stores in December.

In November, Jia Yueting had written an email to employees saying the firm had burnt cash too quickly as it expanded into businesses ranging from smartphones to driverless cars. The founder had acknowledged its global expansion strategy went too far in the face of limited capital and resources and that it would cut costs and realise efficiencies.

Industry executives attributed the likely exit to the financial crisis at the parent firm and its decision to focus on China and the US. Indian sales also nosedived after the November currency swap, hastening the decision, they said. Jobs have been shed at both the Mumbai and Delhi offices that currently have skeletal staff, while the company is now firing people at the research and development centres in Bengaluru, sources said.

When contacted, LeEco India chief operating officer Alex Li confirmed the exit of the two senior executives, but denied any plans to exit the market or liquidate stock. On the layoffs, he said the company has recalibrated and reimagined its business in India since last year and has taken steps to ensure that the scale of operations is in sync with resources.

None of it was triggered by the alleged slump in sales due to demonetisation, he said. “All businesses need to be profitable to be sustainable. That has been the primary objective in taking certain measures, though the numbers (of layoffs) indicated are incorrect,” Li said.

He also said the company has new models in the pipeline. However, a senior executive with aleading ecommerce marketplace that does business with LeEco said the company is preparing to exit India as it has been struggling to find a winning formula, with demonetisation further hurting sales.

“Xiaomi is strong online and Oppo-Vivo offline. So, LeEco found it neither here nor there,” he said, requesting anonymity. Another senior industry executive said LeEco was currently liquidating stock and will exit in the next few months. He said the flagship models will not be launched in India.

“The R&D operation may remain for some more time since it does work for the US operations. But it will be downsized,” he said. LeEco had entered India last February in a partnership with Flipkart and immediately caught consumer attention with an advertising blitz, spending as much as Rs 80 crore every month, offering great deals for smartphones and large-screen LED television sets. The company had said it sells the devices at no profit, since it planned to make money by selling content for the devices.